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ALJ Regional Holdings, Inc. Announces Acquisition Of Realtime Digital Innovations, LLC, Amendment To Term Loan And Credit Facility, Full-Time Commitment Of Chairman Of The Board And Chief Executive Officer And Preliminary Third Quarter 2019 Financial Results

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ALJ Regional Holdings, Inc. (NASDAQ: ALJJ) (“ALJ” or the “Company“) announced the following today:

  • Acquisition of Realtime Digital Innovations, LLC (“RDI“), a business solutions provider focusing on intelligence augmentation, process innovation and user experience.
  • In connection with the RDI acquisition, ALJ also announced the closing of an equity private placement raising gross proceeds of $7.0 million at a premium to the market price of the stock.
  • ALJ lowered its guidance for Fiscal 2019.
  • ALJ has entered into an amended financing agreement with Cerberus Business Finance, LLC (“Cerberus“).
  • Jess Ravich, Chairman of the Board, will devote his full time to the management of ALJ as its Chief Executive Officer.

ALJ is a holding company, whose primary assets are its subsidiaries Faneuil, Inc. (“Faneuil“), Floors-N-More, LLC, d/b/a Carpets N’ More (“Carpets“), and Phoenix Color Corp. (“Phoenix“). Faneuil is a leading provider of outsourcing and co-sourced services to both commercial and government entities in the healthcare, utility, retail, toll and transportation industries. Carpets is one of the largest floor covering retailers in Las Vegas, Nevada, and a provider of multiple products for the commercial, retail and home builder markets including all types of flooring, countertops, and cabinets. Phoenix is a leading manufacturer of book components, educational materials and related products producing value-added components, heavily illustrated books and specialty commercial products using a broad spectrum of materials and decorative technologies.

Acquisition of RDI

Effective today, ALJ has acquired RDI (the “Acquisition“), an exclusive partner of Faneuil for the past 18 months providing workflow automation and business intelligence services. The Acquisition, effective immediately, is expected to provide Faneuil with a sustainable competitive advantage in the business process outsourcing space by allowing it to, among other things, (i) automate process workflows and business intelligence, (ii) generate labor efficiencies for existing programs, (iii) expand potential new client target entry points, (iv) improve overall customer experience, and (v) increase margin profiles through shorter sales cycles and software license sales.

The aggregate consideration for the Acquisition paid at closing was $2.5 million, with earn-outs in an amount up to $7.5 million to be paid upon the achievement of certain financial metrics over a three-year period, subject to a guaranteed payout of $2.5 million. Faneuil plans to consolidate the RDI business under Faneuil’s corporate umbrella.

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Faneuil’s President and Chief Executive Officer Anna Van Buren stated, “The acquisition of RDI builds on the valuable relationship we have established over the past 18 months.  Working with RDI has delivered significant innovation to our operations and is integral to our growth strategy, industry leadership, and business transformation.”

Jess Ravich, Chief Executive Officer of ALJ, said, “We continue to execute on our strategy of making strategic investments that are accretive to our shareholders and provide long-term growth across the platform. This acquisition is expected to increase Faneuil’s margin profile and provides further expansion into new markets.”

Private Placement

In connection with the Acquisition, ALJ raised $7.0 million through the sale of 3.9 million shares of its common stock at $1.80 per share to certain accredited investors in a private placement. The $1.80 price per share of common stock represents roughly a 10% premium to the trailing 30-day average closing price of the Company’s common stock on NASDAQ. The investors participating in the private placement also received certain warrants to purchase an aggregate of 1.3 million shares of common stock at $1.80 per share with a two-year term. The Company will use the net proceeds of the private placement to pay the closing consideration for the Acquisition and to repay certain indebtedness under its Cerberus financing facility.

Jess Ravich, Chief Executive Officer of ALJ, said, “The support of this group of sophisticated investors, who are purchasing stock at a premium to market, validates the Company’s mission and prospects.”

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The securities offered in this private placement have not been registered under the Securities Act of 1933, as amended (the “Securities Act“), or applicable state securities laws, and accordingly may not be offered or sold in the United Statesexcept pursuant to an effective registration statement or an applicable exemption from the registration requirements of the Securities Act and such applicable state securities laws. The Company has also entered into a registration rights agreement with the private placement investors, pursuant to which it agreed, upon satisfaction of certain terms and conditions set forth therein, to file a registration statement with the Securities and Exchange Commission registering the resale of the shares of common stock issued in this private placement and the shares of common stock issuable upon the exercise of the warrants issued in this private placement.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of such state.

Reduced Guidance for Full Fiscal Year Ending September 30, 2019

ALJ has revised its full fiscal year ended September 30, 2019 guidance and has forecasted sales of approximately $353.2 million versus $369.8 million in the prior year comparative period, a decrease of $16.6 million, or 4.5%. Net loss for the full fiscal year ended September 30, 2019 is forecasted to be $7.4 million versus $7.3 million in the prior year comparative period, an increase of $0.1 million, or 1.3%. Adjusted EBITDA for the full fiscal year ended September 30, 2019 is forecasted to be $31.0 million versus $33.1 million in the prior year comparative period, a decrease of $2.2 million, or 6.5%.

In January 2019, the Company provided Adjusted EBITDA guidance for the fiscal year ended September 30, 2019 in a range of $34.0 million to $38.0 million.

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For the full fiscal year ended September 30, 2019 cash capital expenditures are forecasted to approximate $16.0 – $18.0 million, primarily related to the buildout of three call centers for Faneuil, with cash interest forecasted to approximate $9.0 million and cash taxes forecasted to approximate $1.0 million.  This guidance is consistent with previous guidance provided in January 2019.

The reduced guidance is primarily due to reduced results at our Faneuil subsidiary. During the quarter there were delays in customer ramp-ups, the wind down of certain contracts and certain other challenges. These issues will result in lower margins, and resultant EBITDA for both the June and September quarter, with the bulk of the reduction occurring in the June quarter.

Anna Van Buren, Faneuil’s CEO, commented, “During the quarter, several new projects experienced delayed customer driven ramp progressions and one new project faced challenges during the ramp up. The delayed projects will all be up and running during the remainder of 2019 and the challenge faced with regard to the one project has been resolved. In addition, we continue to invest in the talent and infrastructure necessary to support both our revenue growth and our margin improvement. The RDI transaction is one such investment that will help us increase our profit margins. We are also proud to report that Faneuil significantly expanded our commercial business during the quarter with five key new logo wins including multiple BCBS clients and two national healthcare payers.”

Faneuil backlog at June 30, 2019 is estimated to be $432.0 million versus $259.0 million in the prior year comparative period, an increase of $173.0 million, or 66.8%.  Faneuil is expected to have nine new contract implementations beginning in the fourth quarter.  On an annualized run-rate, these new contracts are expected to generate over $40 million in additional sales and $5.0 million in Adjusted EBITDA, which will be recognized in Fiscal 2020.

ALJ expects to provide full third fiscal quarter results on or before August 14, 2019.

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In our earnings releases, prepared remarks, conference calls, presentations, and webcasts, we may present certain adjusted financial measures that are not calculated according to generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures are designed to complement the GAAP financial information presented in this release because management believes they present information regarding ALJ that is useful to investors. The non-GAAP financial measures presented should not be considered in isolation from, or as a substitute for, the comparable GAAP financial measure. We present adjusted EBITDA because we believe it is frequently used by analysts, investors and other interested parties in the evaluation of our company. ALJ defines adjusted EBITDA as net (loss) income before depreciation and amortization, interest expense, litigation loss, restructuring expenses, stock-based compensation, acquisition-related expenses, loss (gain) on disposal of assets, other non-recurring items, other income, and provision for income taxes. Adjusted EBITDA measures are not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure for comparison. Below are reconciliations of our net (loss) income, the most directly comparable GAAP measure, to consolidated adjusted EBITDA:

Amounts in $000’s

Fiscal Year Ended September 30,

2019

2018

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$ Change

% Change

(unaudited)

(unaudited)

Net income (loss) 

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$    (7,430)

$    (7,332)

$       (98)

(1.3%)

Depreciation and amortization

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21,053

19,048

2,005

10.5%

Interest expense

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11,040

10,558

482

4.6%

Provision for income taxes

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4,377

4,299

78

1.8%

Stock-based compensation

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742

1,054

(312)

(29.6%)

Lease payments in anticipation of facility shutdown

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572

250

322

128.8%

Restructuring expenses

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383

2,314

(1,931)

(83.4%)

Loan amendment fees

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337

337

Acquisition-related expenses

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97

280

(183)

NM

Litigation loss

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2,910

(2,910)

NM

Disposal of assets and other gain

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(221)

(277)

56

NM

Consolidated Adjusted EBITDA

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$    30,950

$    33,104

(2,154)

(6.5%)

NM – Not Meaningful

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Financing Agreement Amendment

ALJ entered into the Fifth Amendment (the “Fifth Amendment“) to the Financing Agreement, dated as of August 14, 2015 (as amended and restated from time to time, the “Financing Agreement“), by and among the Company, Faneuil, Carpets, Phoenix, each subsidiary of the Company listed as a “Guarantor” on the signature pages thereto, the lenders from time to time party thereto, Cerberus, as collateral agent for the lenders (the “Collateral Agent“), and PNC Bank, National Association, as administrative agent for the lenders (the “Administrative Agent“). The Fifth Amendment was entered into by the Company in order to support the continued growth of the Company and the associated increase in cash capital expenditures for Faneuil’s buildout of three new customer call centers to support anticipated increased contract awards.

The Fifth Amendment included, among other amendments, the following:

  1. The creation of a seasonal revolver facility with $7.5 million in availability;
  2. An increase in the size of the capital expenditure basket allocated for the buildout of three new customer call centers at Faneuil from $15.0 million to $18.5 million;
  3. An increase in the leverage ratio threshold from 3.50:1.00 to 3.75:1.00 for the fiscal quarters ended September 30, 2019 and December 31, 2019; and
  4. Updates to certain definitions, representations and warranties to allow for the Acquisition.

For further details on the Fifth Amendment, please see the Company’s current report on Form 8-K filed with the SEC, dated as of the date hereof.

Full-Time Employment of Jess Ravich as Chief Executive Officer

ALJ is pleased to announce that its Executive Chairman, Jess Ravich, would step down from such role and assume full-time responsibilities as the Company’s Chief Executive Officer. Mr. Ravich will continue to serve as the Company’s Chairman of the Board. As Chief Executive Officer, Mr. Ravich will provide full-time services to assist management of Faneuil, Carpets and Phoenix to grow their earnings and to source and acquire new businesses that provide accretive opportunities for the Company.

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John Scheel, Vice Chair of the Company’s Board, said, “We are very excited to announce the transition of Jess Ravichfrom ALJ’s Executive Chairman to full-time Chief Executive Officer. Given the nature of our business, ALJ’s CEO needs to thrive in a highly dynamic environment, with the capability of accelerating the Company’s growth, and disrupting what needs to change. Jess is unique in his ability to translate vision and strategy into world-class execution, and we are looking forward to ALJ’s growth under his full-time leadership.”

For further details, please see the Company’s current report on Form 8-K filed with the SEC, dated as of the date hereof.

 

SOURCE ALJ Regional Holdings, Inc.

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CapitaLand Investment launches research paper on ‘Asia Pacific Data Centre Investment Strategies in the Age of Digitalisation’

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 Strong secular tailwinds drive investors’ interest in the region’s sector
SINGAPORE, July 5, 2024 /PRNewswire/ — CapitaLand Investment (CLI) has launched its latest research paper on investment strategies for Asia Pacific’s (APAC) data centre (DC) industry as part of its ‘Perspectives’ research series.  Leveraging insights from CLI’s expertise on the ground, the research paper highlights the demand drivers behind the rapid growth of DCs in the region and strategic investment considerations for investors. The paper also includes a case study on navigating India’s DC sector.

Ms Michelle Lee, CLI’s Managing Director, Private Funds (Data Centre), said: “Digitalisation is a global mega trend driving the growth of data centres. With the DC sector’s strong secular tailwinds, 97% of institutional investors plan to increase their capital allocation into the sector1, particularly in Asia Pacific. As DCs are more resilient, allocation to this asset class can be an integral part of investors’ portfolio diversification strategy.”
“CLI has accelerated our growth in the DC sector, adding 22 DCs since 2021. Today, we have 27 DCs with about US$4.5 billion assets under management and more than 800 megawatts (MW) in gross power across eight countries globally2.  CLI has vertically integrated DC capabilities spanning across design, development, sales, and operations. With DC domain capabilities, combined with our deep market knowledge, deal-sourcing and investment network in Asia, we are well-positioned to partner with investors to tap into the wealth of opportunities in the sector,” added Ms Lee.
APAC as a strong growth market
While cloud computing has been the primary driver for DC demand, the rise of artificial intelligence (AI) is now fuelling a more explosive growth. The revolution in the scale at which data is being used and managed is fundamentally a global phenomenon, but nowhere is it unfolding as rapidly as in APAC markets. On population per MW basis, APAC markets are underserved compared to regions such as EMEA and North America3.
APAC economies are not only growing faster, the region’s enormous population and swelling internet user base also cement its status as a highly attractive destination for DC investment. Its internet user base has grown seven-fold since 2005, compared to the growth of 1.9 times in the Americas and 1.8 times in Europe over the same period4. Going forward, APAC markets should continue to lead, as internet adoption further increases given the lower penetration rates in the region.
DC transactions in APAC rose about 2.4 times to approximately US$22 billion from 2019 to 2023, compared to the preceding five years, even as markets generally stagnated during the COVID-19 pandemic5.
While hyperscalers continue to drive DC demand, APAC colocation market is also expected to double in size to US$52 billion by 20266, becoming the world’s largest colocation DC market.
Key DC markets in APAC
Tokyo, Osaka, Seoul, Singapore and Sydney are key developed DC markets in APAC7. These markets have achieved scale and are important DC hubs in the region.
Beijing and Shanghai also show promise due to China’s large population, growing digital services sectors, strong government support, and robust long-term economic prospects. 
Increasing demand for DCs in India
Highlighting India as a hotspot for DC investment, Mr Sanjeev Dasgupta, CLI’s CEO for India, said: “India’s DC industry has seen increasing interest from institutional investors and has a long runway for further growth. India has the world’s second highest number of mobile subscribers and one of the fastest growing data consumption per user rates. The government’s digitalisation drive, data localisation regulation as well as the growth of cloud and AI will generate more demand for DC capacity. With CLI’s 30 years of experience in India, we have the capabilities and a deep understanding of the local market. We have a dedicated team of DC experts in India and are currently developing four DCs across the key markets of Mumbai, Bengaluru, Chennai and Hyderabad with a total gross power of 244 MW.”
The seven major cities in India – Mumbai, Bengaluru, Chennai, Hyderabad, Delhi NCR, Pune, and Kolkata – are the focal points for new DC development, offering strategic locations with proximity to key business centres. Mumbai stands out as the preeminent hub, hosting more than half of the country’s DC capacity8 with the other major cities mentioned developing strongly.
Opportunities and strategic considerations
Different DC models offer a spectrum of options for investors, catering to different preferences and risk appetites. However, the lack of stabilised DCs available for sale in APAC means the most promising opportunities for investors lie in developing new DCs – a strategy that can both satisfy new demand and yield higher returns.
Power availability has taken centre stage as a crucial determinant for DC locations. There is also a growing emphasis on sustainability. Increasingly, DC users and savvy operators are seeking to reduce their carbon footprints by being more energy-efficient and tapping renewable energy sources.
Investors should also be mindful of the geopolitical, regulatory and technological risks associated with DC investments. It is therefore crucial for investors to collaborate with DC partners who have a strong network, local expertise, and specialist domain knowledge.
To read the full research paper on DC investment strategies in APAC, visit: https://www.capitaland.com/global/en/about-capitaland/newsroom/Perspectives/2024/Apac_Data_Centre_Investment_Strategies_Age_of_Digitisation.html
Launched in 2022, Perspectives is CLI’s series of thematic and topical research reports aimed at providing proprietary insights on real asset investment trends and strategies, private equity developments, macroeconomy and markets. For more, visit:https://www.capitaland.com/en/investment/news-and-events/perspectives.html
[1] 2024 Global Data Centre Investor Sentiment Survey, CBRE.
[2] Includes data centres in operation and under development.
[3] The World Bank, United Nations, CBRE, CLI PERA Research, June 2024.
[4] ITU World Communication, CLI PERA Research, June 2024.
[5] MSCI, Real Capital Analytics, CLI PERA Research, June 2024.
[6] CBRE, CLI PERA Research, June 2024.
[7] CBRE, Cushman & Wakefield, DC Byte, CLI PERA Research, June 2024.
[8] Avendus, “DCs: Powering Digital India”, May 2023, DC Byte, CLI PERA Research, June 2024.
 
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Securden Recognized as a Market Leader in GigaOm Radar Report for Enterprise Password Management

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Securden has become a leader and an outperformer with cutting-edge features, rapid market advancements, and consistent customer value.
WILMINGTON, Del., July 4, 2024 /PRNewswire/ — Securden, Inc., a leading provider of privileged access and identity security solutions, today announced that it has been recognized as a leader and outperformer in GigaOm Radar Report for Enterprise Password Management.

GigaOm rigorously evaluates vendors in various solution segments and produces Radar reports with valuable insights to assist enterprise decision-makers in evaluating and investing in solutions.
The GigaOm Radar 2024 on Enterprise Password Management examined 13 enterprise password management solutions. “Securden is positioned in the innovation quadrant. It offers a strong solution, and its approach is to take its customers on a journey to broader PAM, with password management simply one focus area. It scored well across all of the decision criteria we evaluated, placing it as a leader, and its execution of the emerging features and rate of progress in the market classify it as an Outperformer,” states the report.
Securden has earned top ratings in key evaluation criteria, including platform security, security auditing, PAM capabilities, ease of management, ease of use, and scalability.
“We are proud to be recognized as a market leader in Enterprise Password Management by GigaOm Radar,” said Bala Venkatramani, CEO of Securden, Inc. “Protecting various identities used by humans and machines is a top priority for IT teams. Our platform offers a comprehensive privileged identity security solution, witnessing rapid adoption by SMBs and Enterprises globally. With innovation at the core, we are committed to offering simplicity and affordability in cybersecurity. This recognition affirms our strong market presence and our focus on providing powerful capabilities to strengthen our customers’ security posture.”
Securden offers robust protection for the vault with controls like access hardening, resilient deployment, and strong data protection approaches. It offers insights into password usage, identifies poor practices, flags failure to follow password standards, issues breach warnings identifying compromised passwords, and more. These measures significantly help reduce password-related risks.
Streak of Recognition
EMA Research, a top industry analyst firm, recently published an impact brief recognizing the Securden Unified PAM MSP platform as a groundbreaking development in privileged access management for MSPs. “By eliminating the need for disparate PAM solutions and providing comprehensive functionality within a single package, Securden empowers MSPs to deliver robust, scalable, and secure PAM services to their clients with unparalleled efficiency and confidence,” states the impact brief.
About Securden
Securden provides leading privileged access governance and identity security solutions that uniquely combine critical security principles to prevent cyberattacks, malware propagation and insider exploitation. With products designed for security and scalability (Password Vault for Enterprises, Unified PAM, Endpoint Privilege Manager, and Unified PAM MSP), Securden is trusted by organizations worldwide, including large financial institutions, government agencies, healthcare organizations, educational institutions, IT service providers, MSPs, and manufacturing companies. For more information, visit https://www.securden.com.
Media ContactJames [email protected]
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Managed Security Services Market Forecast to Exceed USD 101.86 Billion by 2031 Due to Escalating Security Concerns | SkyQuest Technology

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WESTFORD, Mass., July 4, 2024 /PRNewswire/ — According to SkyQuest, the global Managed Security Services Market size was valued at USD 26.89 billion in 2022 and is poised to grow from USD 31.18 billion in 2023 to USD 101.86 billion by 2031, growing at a CAGR of 15.95% during the forecast period (2024-2031).

The global managed security services market has been growing rapidly, over the last couple of years, due to the increasing security threats or risks and increasing challenges in managing security over IT networks. It’s impossible to ignore the fact that small businesses face relentless cyberattacks, including malware, ransomware, advanced threats, advanced persistent threats, and data breaches, leading to remote and hybrid operations systems.
Download a detailed overview:
https://www.skyquestt.com/sample-request/managed-security-services-market
Managed Security Services Market Overview:
Report Coverage
Details
Market Revenue in 2023
USD 31.18 billion
Estimated Value by 2031
USD 101.86 billion
Growth Rate
Poised to grow at a CAGR of 15.95%
Forecast Period
2024–2031
Forecast Units
Value (USD Billion)
Report Coverage
Revenue Forecast, Competitive Landscape, Growth Factors, and Trends
Segments Covered
Service Type, Type, Organization Size, Security, Type and Industry Vertical
Geographies Covered
North America, Europe, Asia Pacific, and the Rest of the world
Report Highlights
Updated financial information / product portfolio of players
Key Market Opportunities
Surge in Demand for Managed Detection and Response (MDR) Service
Key Market Drivers
Cyber Threats are Growing Complex 
Segments covered in Managed Security Services Market are as follows:
Service TypeManaged IAM, managed vulnerability management, managed risk and compliance, managed detection and response, managed firewall, and managed SIEM and log management, othersTypeFully managed, co-managedOrganization SizeSmall and medium-sized enterprises, Large enterprisesSecurity TypeNetwork security, cloud security, endpoint security, application security, othersIndustry VerticalBFSI, government, healthcare & life sciences, telecommunications, IT and ITeS, Retail and eCommerce, energy and utilities, manufacturing, and other verticalsRequest Free Customization of this report:
https://www.skyquestt.com/speak-with-analyst/managed-security-services-market
Rapid Responders: Incident Response Services
Managed detection and response are the large segment in the managed security services market. Managed detection-response services provide continuous improvement, threat detection, and response capabilities critical to today’s enterprises facing sophisticated cyber threats. This segment is characterized by the increasing prevalence and importance of cyberattacks advanced threat detection and response strategies beyond traditional security measures. The ability of the MDR service to provide comprehensive analysis of security incidents and take corrective action quickly is essential to minimize potential damage and ensure business continuity.
Managed identity and access management is the fastest growing segment in the market. The rising growth in this sector is driven by the need for robust stakeholder solutions in an era of digital transformation and remote collaboration. The rise of cyber threats and increasing regulatory requirements for data security and privacy and the main drivers of this segment.
Data Guardians: Data Protection Services
The global market recognizes the dominant position of the entire service management segment. This dominance is largely due to the scope of this role, in which companies assume full responsibility for an organization’s security programs from security providers, especially those without in-house security expertise or resources. These roles cover a wide range of security measures, including threat identification, incident response, compliance management and continuous monitoring. Adoption rates are also driven by the increasing complexity of cyber threats, which require a strong, 24/7 monitored security measure that only specialized providers can provide further strengthening its position as the largest market share.
In addition to the dominance of fully managed services, the advanced management segment is growing the fastest in the global market. This increase is driven by hybrid security models that offer a collaborative approach between internal IT teams and external security providers.
View report summary and Table of Contents (TOC):
https://www.skyquestt.com/report/managed-security-services-market
Safeguarding Tomorrow’s Digital Frontiers
As businesses and organizations take on the cyber panorama in terms of severe, MSS vendors remain vigilant guards, the use of advanced era and professional insights. Managed Security Services (MSS) have emerged as the cornerstone of present-day cybersecurity strategies, presenting strong protection in opposition to threats in a more and more digital international.
Related Report:
Cyber Security Market
Network Security Market
Endpoint Security Market
Cloud Security Market
Application Security Market
About Us:
SkyQuest is an IP focused Research and Investment Bank and Accelerator of Technology and assets. We provide access to technologies, markets and finance across sectors viz. Life Sciences, CleanTech, AgriTech, NanoTech and Information & Communication Technology.
We work closely with innovators, inventors, innovation seekers, entrepreneurs, companies and investors alike in leveraging external sources of R&D. Moreover, we help them in optimizing the economic potential of their intellectual assets. Our experiences with innovation management and commercialization has expanded our reach across North America, Europe, ASEAN and Asia Pacific.
Contact:Mr. Jagraj SinghSkyquest Technology1 Apache Way,Westford,Massachusetts 01886USA (+1) 351-333-4748Email: [email protected] Our Website: https://www.skyquestt.com/
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